The Australian postcodes millennials are fleeing to for cheaper housing – as a new wave of migrants head for the suburbs they’ve left

Millennials are fleeing suburbs where house prices are rising fastest and moving to parts of Australia where property is cheaper.

Sydney is losing young people in suburbs where more overseas migrants are moving.

The e61 Institute, an economics research group, said the eastern suburbs and Parramatta in particular were experiencing an exodus.

‘Affordability of housing is a prime suspect. Sydney people are leaving the areas where house prices have risen the fastest,” the report said.

Millennials, those born between 1981 and 1996, are also more likely to leave in the years when they have children of their own and need a home.

“Those in their thirties are moving out the fastest, the age at which families are growing and need more homes,” the report said.

“These trends may indicate that unaffordable housing is driving large-scale redistribution of labor across Australia.”

Sydney’s median home price of $1.334 million is so high that an average, full-time, $94,000-a-year worker would struggle to pay off a $1 million loan while owing the bank 11 times his salary on a mortgage of 20 percent.

But in the eastern suburbs, Bondi prices are well above $4 million, rising to $8 million in port-side Vaucluse, CoreLogic data shows.

This puts housing out of reach for even a two-income couple, with households in these beachfront zip codes typically earning more than $200,000 a year, IRS figures show.

An elite professional would need to earn $377,553 to be in the top 1 percent of income earners to afford even a $2.84 million home and avoid mortgage stress where someone owes the bank six times or more of what they owe. deserves.

Those in their 40s and 60s who are more likely to own a home were the next most likely to move, primarily for lifestyle reasons “related to retirees changing seas and trees.”

People leaving Sydney are more likely to move to southeastern Queensland, Canberra or regional New South Wales.

“Most opt ​​for less expensive nearby coastal areas, including the regions of Wollongong and Newcastle and the Gold Coast,” the report said.

‘Canberra is also popular; Melbourne, not so much.’

Sydney has also received a higher share of overseas immigration than any other city, with a population growth rate of one percent per year.

But over the past two decades, 0.5 percent of the population has left, mainly to another part of Australia.

The e61 Institute calculated that for every additional percentage point that house prices rose in an area in the five years to 2016, an additional 0.2 percent of the population moved out in the following five years.

Sydney has also received a higher share of overseas immigration than any other city, with a population growth rate of one percent per year. But over the past two decades, 0.5 percent of the population has left, mainly to another part of Australia (pictured is Wynyard station)

When the real estate market peaked in May 2022, house prices in Sydney were rising at an annual rate of 17 percent.

But in September 2021, prices in Sydney were up 30 percent year on year, when interest rates were still at a record low of 0.1 percent.

Sydney’s median home fell 2.4 percent over the year to July, but rose a further 1 percent in the month despite the Reserve Bank’s 12 rate hikes since May 2022, pushing cash rates to a 11-year high of 4.1 percent.

Treasury expects 400,000 people to have moved to Australia by 2022-23, with 1.5 million expected in the five years to June 2027.

The exodus from Sydney, as more overseas migrants moved in, seemed to continue.

“Sydney is rapidly losing its population to other places in Australia, offset only by inbound foreign migration,” the report said.